Turning around a pioneering service for working parents with sick children

The Situation

The overwhelming majority of Japan's 30,000 day care centers fail to address an urgent need for working parents: What happens when your child is sick?

Only 2 percent of the centers offer care for sick children and almost all of them are struggling to achieve profitability because demand is highly unpredictable. For parents, the solution often means calling in sick, making it difficult to juggle a career with raising children.

In 2005, ChildCare Co*, a not-for-profit social enterprise, launched a unique childcare model for working parents in Tokyo. Instead of creating dedicated facilities, the service relied on a network of experienced babysitters to look after sick children.

Although the model was immediately popular, growing at a rate of 80 percent year-to-year, the enterprise was operating at a significant loss and faced increasing financial difficulties in its first two years of operation.

Our Approach

Our social sector consulting practice played a pivotal role in turning around ChildCare Co's innovative babysitting service business for sick children. Our pro-bono projects operate much like our for-profit work. We agreed with ChildCare Co's top leadership on key objectives, drew from our Bain toolkit and tailored our results-driven approach to meet the enterprise's specific needs.

Our case team helped senior managers to:

• Develop a new pricing strategy based on a model that forecasts demand. Our process included analyzing the profitability of each customer segment to craft an affordable pricing structure.
• Conducting in-dept customer and employee interviews to strengthen ChildCare Co's loyalty program.
• Developing capacity planning to better anticipate customer demand.

Our Recommendations

Working together with ChildCare Co, we helped launch a transformation of its finances and babysitting operations for sick children, enabling it to build a solid financial foundation and attract new customers for the social enterprise's continued growth. 

The Results

With a clear strategy and attractive pricing plan, our collaboration helped turn around the social enterprise in just two years, creating a solid foundation for continuous growth. In 2009, ChildCare Co broke even for the first time, won international recognition—and most important, provided expanded services for working families when a child is sick.

The transformation allowed ChildCare Co to:

• Triple its customer base between 2008 and 2010, while maintaining strong customer loyalty.
• Expand services from Tokyo to surrounding areas.
• Fund two new business launches—childcare centers for sick children, in addition to its network of babysitters.
• Set up training services to improve employee work-life balance.